The Minnesota Department of Human Services Office of Inspector General, in collaboration with county agencies, works to prevent public assistance fraud. The following illustrate cases where people were convicted of various types of fraud and either were required to pay back money or had their funding stopped. If you have a tip or complaint about potential fraud, report it.
A southern Minnesota county, in consultation with the DHS Office of Inspector General (OIG), successfully excluded a childcare center from receiving public funding for one year due to fraudulent billing. The county’s investigation showed that the center inflated its attendance records. On four different occasions, childcare personnel visited the center and observed fewer children than the center reported on its attendance records. The center billed the state for more children than were listed on daily attendance records, and more children than were observed. This case is important for several reasons. Because the appropriate standard of evidence was found to be a preponderance of evidence, and not the higher standard of clear and convincing evidence, it will make it easier for counties to clamp down on intentional program violations against childcare centers that defraud the state. This means counties need only establish that it is more likely than not that a provider engaged in the intentional program violation. Also, this case establishes that counties can successfully determine a center’s intent to defraud by using circumstantial evidence. In other words, if a county can show many circumstances consistent with the intent to defraud, the circumstances can be considered sufficient without having to introduce direct testimony or evidence of fraud. As such, this case should significantly benefit counties interested in pursuing childcare providers through the administrative disqualification hearing process. The OIG legal unit is available to answer any questions or concerns related to this case. Please contact the OIG at 651-431-4328 or James.Ortmann@state.mn.us.
A fraud case against a Central Minnesota couple who received public assistance yet failed to report their income ended with the couple being convicted and paying restitution totaling $60,745. The husband had an unreported job in Crow Wing County. In addition, a fraud prevention investigator (FPI) discovered the couple owned a semi-truck licensed in North Dakota and worked for a company in that state. This business had been operating the entire time the couple received public assistance. The North Dakota company that employed the individuals provided the investigator with their IRS Miscellaneous income form for two years indicating that they grossed over $100,000 each year. When the FPI tried to contact the couple regarding their work, they never responded so the case was turned over to a criminal investigator. The criminal investigator also received no response on requests for information. Ultimately this case was charged in court and the couple pled guilty. Although given the opportunity to provide expenses against their income, they never complied. They were charged with wrongfully obtaining assistance and required to pay restitution.
The owner of a Minneapolis Home Health Care agency was terminated as a Minnesota Health Care Programs (MHCP) provider in October 2013 as a result of his federal conviction for defrauding Medical Assistance. The individual owned Lucky Home Health Care. His conviction for defrauding Medicaid is a result of submitting fraudulent billings in excess of $400,000 from January 2008 through June 2011. The individual submitted claims that falsely indicated that home health care services were provided. Home health care is one of the services reimbursed by the Medical Assistance program. The case stems from an investigation by the FBI.
A metro area man was convicted in December 2013 with a combination of aiding and abetting Medical Assistance fraud and aiding and abetting theft. The man was a provider in the Minnesota Health Care Programs, providing personal care assistants to Medical Assistance recipients. The metro area man submitted false claims to DHS and Blue Cross Blue Shield (BCBS) that resulted in an overpayment of $75,000 from both DHS and BCBS. DHS withheld MHCP payments until the man was later terminated as a provider based on the conviction. The case was originally investigated by the Surveillance and Integrity Review Section of the DHS Office of Inspector General and referred to the Minnesota Attorney General’s Office/Medicaid Fraud Control Unit (MFCU). In a related case, a personal care attendant (PCA) who worked for the agency was convicted of theft, required to pay $7,000 in restitution to DHS, and not allowed to work for any program that received Medicaid funding for submitting false PCA timecards. The PCA was subsequently terminated by SIRS based on the MFCU conviction.
A Duluth dentist has been charged with submitting false Medical Assistance claims to DHS over a two-year period totaling $50,000. His health care fraud included submitting false claims as well as claims for services that had not been performed.
A Redwood County small business owner was convicted in April 2014 of two felony charges and ordered to pay $7,579 in restitution after applying for public assistance and falsely reporting no income or liquid assets. The woman’s business had been burglarized and involved in two fires. As a result, she had received a lump sum insurance payment and was also receiving monthly business loss income. She was regularly transferring some of the insurance money into her personal bank account even though she claimed she had no income. The individual would take the insurance checks to the bank and request cash payouts so that her personal income account, when reviewed for eligibility verification purposes, showed no regular source of income. While on public assistance programs – including SNAP, cash and health care – she received a total of $45,000 in business loss income which went unreported. In addition to paying restitution, the woman was sentenced to five years’ probation and required to perform 240 hours of community service work. This conviction is the result of collaboration by the county fraud prevention investigator, the county financial worker and local law enforcement.